Cider tax rise dropped from June

The cider industry has been left in limbo after Budget plans for a 10% above inflation duty hike were dropped.

The increase will stay in place until June 30 when it will lapse as one of a number of sacrifices Labour has been forced to make in its Finance Bill to force it through before the election.

The move leaves it open for Labour to re-introduce the increase if it returns to power. Chancellor Alistair Darling had justified the hike on the grounds that cider had received a better ride on tax than other drinks categories historically.

The Conservatives had criticised the tax increase which has also been the target of a fierce internet campaign.

Tory leader David Cameron described the increase as “misinformed and wrong”.

The rise announced in the Budget will stay in place until the end of June when it will revert to the 2% above inflation increase handed out to other alcohol categories.